Business confidence in South Africa picked up modestly in May, rebounding from a sharp decline in April, according to data released by the South African Chamber of Commerce and Industry (SACCI).
The Business Confidence Index (BCI) rose to 115.8 in May, up from 114.9 in April, although it remained well below the March reading of 123.5. The recovery was supported by a stronger rand, record-high stock performance on the Johannesburg Stock Exchange (JSE), and elevated prices for gold and platinum.
SACCI noted that the rand appreciated by over 3% against the US dollar in May, helped by positive market sentiment around precious metals, speculation about a lower inflation target, and growing optimism around the approval of the national budget after months of political disagreements among coalition partners.
The JSE continued to perform strongly, with stocks hitting multiple record highs during the month, buoyed by global demand for commodities and improved investor sentiment.
April’s sharp decline in confidence was linked to global tensions, particularly trade tariffs introduced by former U.S. President Donald Trump, which triggered renewed uncertainty in international markets. SACCI attributed part of the dip to these external shocks and a reaction to Washington’s “Liberation Day” tariffs.
However, diplomatic efforts are now underway to stabilise trade relations. South African President Cyril Ramaphosa recently held talks with Trump in Washington, resulting in a series of trade proposals aimed at easing tensions and strengthening bilateral economic cooperation.
SACCI welcomed Ramaphosa’s visit, describing it as a “timely intervention” to help restore confidence and deepen business and economic ties between the two nations.
With South Africa’s third version of the 2025 budget now accepted by major political players, the business chamber urged policymakers to shift focus toward more urgent national priorities—namely economic growth, investor confidence, and job creation.
“South Africa should attend to matters that scare off investors – especially foreign investors,” SACCI said in a statement, hinting at the need for better policy clarity, reduced bureaucracy, and improved infrastructure.
Analysts say the gradual recovery in business confidence could provide a boost to short-term economic activity, especially if structural reforms are fast-tracked and global conditions remain favourable.
The SACCI index, released every two months, is a key barometer of private sector sentiment in South Africa and is closely watched by investors, policymakers, and international partners.
While the May uptick is encouraging, business leaders caution that long-term improvements will depend on how effectively the government handles electricity supply issues, regulatory bottlenecks, and youth unemployment—all of which remain significant obstacles to sustained growth.
